support a credible opinion of value. The standard of care for expert witness assignments is substantially higher than for typical valuation assignments. Both opposing counsel and the expert witness representing the other party will likely carefully review and scrutinize the expert’s underlying data, analysis and final report. Expert witnesses who develop an opinion of value which is unreasonable tend to cause cases to unnecessarily proceed to trial.
The higher standard of care appropriate for expert witness assignments extends through all phases of the assignment. The expert should precisely determine the scope and purpose of the assignment. This includes the letter of engagement, scope of work, research, report preparation, deposition and trial testimony, and preparation for deposition and trial testimony. All data needs to be researched and verified. In many cases, even if sales data has been previously confirmed, it will be verified a second time for the expert witness assignment. Even if the factual data regarding a comparable sale is accurate, issues relating to the motivations of the party can be meaningful. For example, if a purchaser was anxious to purchase it a property because they own the adjacent property, this could artificially influence the sales price. If an expert witness was unaware of such a fact, it could undermine their credibility during a deposition or at trial. The calculations and thought process for the analysis need to be checked and double-checked, as do the report. The expert needs to carefully prepare for both deposition and trial testimony.
Appraisers sometimes believe that preparing a voluminous narrative appraisal, totaling perhaps 200 pages, which effectively documents their opinion is helpful for litigation. However, it is virtually impossible to prepare a voluminous document without overlooking minor errors. For this reason, is typically better to summarize the data and opinion instead of presenting them in a voluminous report. Preparing a summary report also helps to reduce the cost of an expert witness engagement. While it is important to carefully research the facts and perform a thorough analysis, there is little benefit to preparing a voluminous report.